Environmental

Vesteda constantly aims to improve our sustainability performance, which helps us safeguard the attractiveness of the fund and optimise our long-term risk/return ratio. Our objective is to reduce the consumption of energy and water, and cut CO₂ emissions. We also aim to stimulate a circular approach in the use of materials, increase biodiversity around our complexes and improve the climate adaptivity of our portfolio. Finally, we encourage our business partners to have the same high sustainability standards.

Portfolio sustainability improvements

In 2015, Vesteda’s participants approved a plan to improve the energy performance of Vesteda’s buildings. Our ambition is to have green energy labels (A, B or C) for 99% of our portfolio by year-end 2024. It is nearly impossible to achieve 100% green labels, considering the state of city centre buildings and historical buildings, as well as local government regulations.

In 2023, we invested €22 million and improved the energy performance of 3,699 residential units. The measures included the installation of high-efficiency boilers, DC ventilators, LED lightning in common areas, insulated glass, insulation of roofs, cavity walls and under floors, and the installation of solar panels. Vesteda installed a total of 11,247 solar panels last year. At year-end 2023, Vesteda had a total of 35,953 solar panels in its portfolio, generating approximately 8.9 million kWh annually.

The percentage of homes in our portfolio with a green energy label (A, B, or C) increased to 96% in 2023, from 94% the previous year. The percentage of A labels increased from 40% in 2022 to 50% in 2023, due to the renewal of energy labels of existing homes.

Energy labels (%, weight in units)

Healthy and safe homes

We want to provide our tenants with healthy and safe homes. This means that central heating boilers are checked regularly, lifts are checked frequently and combined heat and power installations are provided with new filters if necessary. We also strive to have homes without high-risk asbestos. The quality of drinking water is also essential. Although these measures are of a more technical nature, they can have a positive impact on the lives and well-being of our tenants. To ensure the health and safety of our homes as effectively as possible, we took the following precautionary measures that were monitored or executed by our Operations department:

• Legionella: Up until 2023, approximately 80% of our multi-family complexes were inspected for legionella risks in the central part of these buildings. If Vesteda is not the sole owner of a building, we ask the owners’ association to initiate the inspection.

• Asbestos: An external partner inspects our homes if the presence of asbestos is suspected, for example based on the year of construction or other information. If asbestos was found, Vesteda took appropriate action, including clean-ups and providing information for tenants and third parties.

• Central heating installations: Over the course of two years, nearly 76% of all our central heating systems were inspected.

• Combined heat and power installations: In 2023, we inspected more than half of the combined heat and power installations. The remaining installations will be inspected before the end of 2024.

• Lifts: Nearly all lifts were inspected in 2023, and 92% were approved. We will inspect the remaining lifts in 2024. In addition, we conducted separate inspection and tests on the emergency audio connections of all lifts.

• Fire safety: We inspected almost all our multi-family complexes in accordance with the Dutch building decree. In addition, in 2023 we inspected the fire extinguishing equipment, water pipes and emergency lighting at a total of 126 complexes.

Sustainable supply chain

Since 2016, we have asked our largest suppliers to sign the IVBN sustainability declaration. Although signing is voluntary, it does give Vesteda the opportunity to start a constructive dialogue and it enables us to promote our core values and influence our suppliers. The next step will be to improve our impact, by rolling out a sustainability scan with questions on policies, targets and results. In collaboration with other IVBN members, we conduct an annual survey that addresses a number of issues related to ESG aspects. The outcome of this survey gives us a good understanding of sustainability in the supply chain. In 2023, 90% of respondents signed the sustainability declaration.

Circular portfolio investments

We encourage and apply the use of circular materials in our new-build construction projects, as well as in renovation and maintenance projects. From our position as an investor, we can make a significant contribution to circularity in partnership with our stakeholders.

Physical climate risks

Due to the changing climate, the real estate sector and its residents are faced with physical climate risks such as heat stress and flooding. In 2021, in collaboration with Climate Adaptation Services and Sweco, Vesteda created an internal risk monitoring tool to gain insights into the physical climate risks within our portfolio. The uniqueness of the tool lies in the integration of both environmental risks and building-specific characteristics. We use this tool to monitor the physical climate risks for Vesteda’s residential portfolio, and this provides valuable information and potential measures to reduce the risks.

Climate risks and impact on Vesteda’s portfolio 2023

The previous graph shows that the risks to our total portfolio are low, and we will address and mitigate the impact on the few high-risk properties. Currently, we are focusing on two types of risks: heat stress and flooding due to extreme rainfall, given that we can mitigate these risks through implementing measures at the building level. We have started assessing and adopting measures for assets with a very high risk of these two risk types, with the aim of mitigating the risks by 2025. We aim to have a mitigation plan for high-risk assets by 2025. We address all other elevated climate risks in a mitigation plan per asset.

Climate risk: heat stress

Climate risk: flooding due to heavy rainfall

Measuring and managing resource consumption

Our goal is to manage and reduce the usage of resources (energy, water) to reduce the production of greenhouse gases in our investment portfolio. We measure the energy consumption in our common areas as well as from our tenants, in collaboration with energy suppliers and grid operators. Please refer to Annex 7 for all energy consumption data according to INREV guidelines.

The reporting, on managing and reducing resource consumption, is according to the INREV GRI reporting standard. The overview showcases an overall reduction of 11.3% (measured in kWh). The overall reduction is attributable to both common areas and tenant space of the portfolio.

Common areas

In 2023, with regards to the common areas, our electricity consumption decreased with -3.1%, and gas consumption with -3.3%. The reduction results from our efforts and investments in improving the sustainability of the portfolio. Since not all utility providers have finalised their annual statements yet, the coverage in 2023 is lower than in 2022.

In a like-for-like comparison, consumption is evaluated for areas where data is available for twelve months in both 2022 and 2023. The square meters of common areas are calculated based on a representative sample, indicating that the actual common area square meters, on average, represent approximately 14% of a complex.

Tenants

In 2023, tenant electricity consumption decreased by -6.3%, gas consumption by -14%, and district heating by -13.5%. The like-for-like comparison is conducted for areas where data is available for twelve months in both 2022 and 2023. A delayed effect of the energy crisis, coupled with our ongoing sustainability efforts, contributed to the reduction in energy consumption among our tenants.

Besides the decrease in energy consumption, there is also an increase in the generation of solar energy. Overall, our portfolio reflects a reduction in total energy consumption, resulting in lower greenhouse gas emissions and decreased expenses for our tenants which improved affordability.

Paris Agreement

As part of our focus on climate change mitigation, we have a CO₂ roadmap, in which we commit to the Paris Agreement by reducing our carbon footprint. In the CO₂ roadmap, we focus on two main KPIs, which are the kWh/sqm consumption and CO₂/sqm emissions of our portfolio. Using the 'Trias Energetica principle', we will first focus on reducing the energy demand of our homes.

CO₂ Roadmap

Our target is to reduce our energy consumption by 55% in 2030, compared with 1990. To achieve this goal, we accelerated our sustainability investments, including investments in climate adaptivity. The roadmap is dynamic, since policies and targets are subject to change. We are well on our way to reach our 2030 target, having reduced our CO₂ emissions by over 50% compared with 1990.

After 2030, we will continue to focus on further reducing energy consumption and on switching to sustainable 'green' energy sources to realise a 95% reduction in CO₂ emissions by 2050. Our goal is to ensure that the remaining energy consumption consists of CO₂ emission-free energy.

CO₂ footprint of our organisation

Vesteda aims to reduce the CO₂ emissions of our organisation. In 2023, the total CO₂ footprint of our organisation was 379 tonnes of CO₂, or 1.707 kg per FTE. This includes ten regional offices. Our 2023 carbon footprint decreased with 18% per FTE compared with the previous year. Based on the GHG protocol, scope 1 accounts for the majority (71%) of our total emissions, compared with 0.4% for scope 2 and 29% for scope 3. 

CO₂ emission per FTE

Note: 2022 figure (scope 2) is restated in the graph following an adjustment in the calculation.

The reduction in our CO₂ footprint is a result of our efforts to reduce the energy consumption in our offices and the electrification of our car fleet.

The CO₂ generated by mobility still accounts for the majority of our total CO₂ footprint. In 2023, we continued to reduce these emissions by making our car fleet more sustainable. As a result, 66% of our car fleet was fully electric at the end of 2023 compared to 38% in 2022. The total CO₂ emissions of our mobility was 19% lower than in 2022.

Transport-related CO₂ emissions per FTE

Circularity within our organisation

In 2022, Vesteda drew up a roadmap to improve circularity within our organisation and this was actively implemented in 2023. We have also drawn up a sustainable purchasing policy together with a third party, so that we can purchase products more responsibly. To increase awareness of the relevance of circularity, we informed Vesteda employees about this. We have increased the number of waste streams at Vesteda's head office. Together with our suppliers, we have created a sustainable range of waste streams for sanitary, office and catering supplies, preferring FSC-certified products and keeping packaging waste to a minimum.